January 9, 2025
Top 10 Stock Cencosud Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Cencosud – Top 10 Stock in Indice de Precio Selectivo de Acciones
Cencosud is listed as a top 10 stock on January 09, 2025 in the market index IPSA because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is below average and thus a signal for caution. Based on the Obermatt 360° View of 40 (40% performer), Obermatt assesses an overall hold recommendation for Cencosud on January 09, 2025.
Snapshot: Obermatt Ranks
| Country | Chile |
| Industry | Hypermarkets, Super Centers |
| Index | IPSA, R/E Growth Markets |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Cencosud Hold
| 360 METRICS | January 9, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 30 |
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| SENTIMENT | ||||||||
| SENTIMENT | 17 |
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| 360° VIEW | ||||||||
| 360° VIEW | 40 |
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ANALYSIS: With an Obermatt 360° View of 40 (better than 40% compared with alternatives), overall professional sentiment and financial characteristics for the stock Cencosud are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Cencosud. The consolidated Value Rank has an attractive rank of 71, which means that the share price of Cencosud is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 71% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 71, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 17. Professional investors are more confident in 83% other stocks. Worryingly, the company has risky financing, with a Safety rank of 30. This means 70% of comparable companies have a safer financing structure than Cencosud. ...read more
RECOMMENDATION: With a consolidated 360° View of 40, Cencosud is worse than 60% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 71 and the Growth Rank above-average at 71, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 17. In addition, the company financing structure is on the riskier side (Safety Rank of 30). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Cencosud negative
ANALYSIS: With an Obermatt Sentiment Rank of 17 (better than 17% compared with alternatives), overall professional sentiment and engagement for the stock Cencosud is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Cencosud. Analyst Opinions are at a rank of 41 (worse than 59% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 34 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 26, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 74% of competitors). No wonder, the Professional Investors rank is only 31, which means that professional investors hold less stock in this company than in 69% of alternative investment opportunities. Pros tend to stay away from Cencosud, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 17 (less encouraging than 83% compared with investment alternatives), Cencosud has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Cencosud Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 71 (better than 71% compared with alternatives), Cencosud shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Cencosud. Price-to-Sales (P/S) is 63, which means that the stock price compared with what market professionals expect for future sales is lower than for 63% of comparable companies, indicating a good value regarding Cencosud's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 73% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 69. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 46% of all competitors have even lower dividend yields than Cencosud (a Dividend Yield Rank of 46). 54% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 71, is a buy recommendation based on Cencosud's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Cencosud Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 71 (better than 71% compared with alternatives), Cencosud shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Cencosud. Profit Growth has a rank of 94 which means that currently professionals expect the company to grow its profits more than 94% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 61, and Stock Returns has a rank of 77 which means that the stock returns have recently been above 77% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 10 (90% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 71, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Cencosud Debt Financing Safety below-average
| SAFETY METRICS | January 9, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 40 |
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| REFINANCING | ||||||||
| REFINANCING | 11 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 61 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 30 |
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ANALYSIS: With an Obermatt Safety Rank of 30 (better than 30% compared with alternatives), the company Cencosud has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Cencosud is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Cencosud. Liquidity is at 61, meaning the company generates more profit to service its debt than 61% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 11, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 89% of its competitors. Leverage is also high at a rank of 40, which means that the company has an above-average debt-to-equity ratio. It has more debt than 60% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 30 (worse than 70% compared with alternatives), Cencosud has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Cencosud Above-Average Financial Performance
| COMBINED PERFORMANCE | January 9, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 61 |
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| COMBINED | ||||||||
| COMBINED | 66 |
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ANALYSIS: With an Obermatt Combined Rank of 66 (better than 66% compared with investment alternatives), Cencosud (Hypermarkets, Super Centers, Chile) shares have above-average financial characteristics compared with similar stocks. Shares of Cencosud are a good value (attractively priced) with a consolidated Value Rank of 71 (better than 71% of alternatives), show above-average growth (Growth Rank of 71) but are riskily financed (Safety Rank of 30), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 66, is a buy recommendation based on Cencosud's financial characteristics. As the company Cencosud's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 71) and above-average growth (Obermatt Growth Rank of 71), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 30) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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